Hello everyone,
Greetings !!!
First of all I would like to appreciate @indiaunited for highlighting a crucial topic, like Emergency Funds.
For some it might be a routine breaker, to re-visit their plans of emergency fund management. For some this platform gives an opportunity to explore other situations or options of the same.
If your interested in participating, click here
Emergency fund is the financial aid, saved for future needs in order to be easily available or liquefied. These funds can also be addressed as 'Reserves'. The amount which is not invested in any instrument, with a locking period.
Since in today's world things can be unpredictable, the planning and execution, of these funds can give a sense of security, avoiding stressful situations. It is rightly said, "Well begun is half done"
Quality time invested in the planning stage matters, in order to get a successful outcome.
The requirements depend upon:
-Number of individuals one is thinking of to be taken care of:
- A family of more than two people
- Senior citizens/child care involved
-The nature of emergency
- Medical Emergency
- Natural calamities
- Job Lay Offs
Yes, I believe in the need of emergency funds.
To have diversity, I have divided my emergency funds into both centralized and decentralized source.
Centralized source is usually a bank account and decentralized is stable coins.
I prefer these options, since tricky situation can occur in any country's economy. I definitely do not see Indian economy facing any economic challenges in the next 10 years but it is better to be prepared.
Once we decide on the emergency fund amount, we have to top up the amount considering the present medical expenses and cost of living. Therefore, the amount of emergency funds should be revised every 3 years, considering the inflation rate.
Fortunately I do not have any EMIs so I can skip planning for any.
Also, think that we all should work towards creating a passive source of income. In those difficult times, this incoming source would act like a breather, and help in buying time to gain stability again. Some of these ways are real estate (residential/commercial), stock market, fixed deposit interest etc.
On a softer note, I would say investment and preservation of
Self Health is important too. In order to survive the storm, of emergency, the base strength has to be strong.
Hasn't Covid 19 taught us all this lesson...
Thank you for reading till the end.
Stay Healthy and Happily Smiling 🦷🪄
